CP151 - Guidance for (Re)insurance Undertakings on Climate Change Risk

Overview

Description

The increased frequency and severity of weather related events linked to climate change is already having an impact on the insurance sector globally. The increase in insured claims arising from physical events alongside the impact of the necessary actions to transition away from greenhouse gas intensive activities, mean that (re)insurers need to take action now to assess and appropriately manage climate change risk.

The Central Bank has published Guidance for (Re)Insurance Undertakings on Climate Change Risk. The Guidance aims to clarify the Central Bank’s expectations on how (re)insurers address climate change risks in their business and to assist them in developing their governance and risk management frameworks to do this.

The Guidance provides a practical framework to help (re)insurers address climate change risks in their business and assist in developing their governance and risk management frameworks. It is based on a set of overarching principles and sets proportionate expectations dependent on the nature, scale, and complexity of the (re)insurer. The infographic that accompanies the Guidance provides a simplified view of how (re)insurers could achieve this in practice.

Publication of the Guidance follows a period of consultation and consideration/incorporation of the feedback received. The Central Bank received four submissions to the consultation. Details on the Central Bank’s consideration of the feedback received are set out in the accompanying Feedback Statement. Many points raised in the submissions were addressed by making minor adjustments to the Guidance and/or clarifying, in the Feedback Statement, the Central Bank’s intention with respect to some of the provisions.

CP Number : CP151
Date : 03 August 2022
Closing Date : 26 October 2022

Consultation Paper Document

CP151 Climate Change Guidance for (Re)insurers | pdf 432 KB

Feedback Statement

CP151 - Feedback Statement - Guidance for (Re)Insurance Undertakings on Climate Change Risk | pdf 463 KB

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